Risk management

Three's a crowd

When taking instructions from a new client it is always important to establish immediately whether there will be any third parties involved in the work.

It could be that there will be other professionals involved, accountants or surveyors, for example.

Alternatively, your firm could be using two different departments to advise on separate issues, or you could be liaising with overseas offices.

Whatever scenario you find yourself in, it is important to be aware that joint instructions is a common cause for notifications being made against a solicitor's professional indemnity insurance.

Often, if one party is negligent when working on joint projects, all parties will be held partly responsible.

When working in conjunction with either another professional firm or another department or office within the practice, it is important to establish proper working guidelines at the outset.

Below is a list of action points which should be implemented when working with joint parties:

- Sit down at the beginning of the case with all parties and the client and agree areas of responsibility and time limits.

- Make sure that this meeting is properly minuted and distributed to everyone involved.

The minutes should show who is responsible for which area of work and should also include a clear timeline with all deadlines highlighted.

- Confirm that all parties agree the minutes and time limits.

- Update your office calendar and files with all the time limits, even those for the other parties involved.

- If confidentiality agreements allow, organise regular meetings with written updates from all parties, so everyone knows how work is progressing.

- If the timetable needs amending, you must check with all parties and the client that everyone still has time to complete work in a timely fashion.

- Keep clear records of all telephone conversations, e-mails and faxes from the other parties and in all cases date and sign written records and include names of all participants where necessary.

- Keep your client properly updated.

More often than not a client does not fully understand what each party is doing or what has already been completed.

If the client is kept informed at all stages of work being undertaken, he is less likely to make a notification against one or all of the parties.

Good risk management is the key to working with third parties.

If you have the above procedures in place, and your general risk management is good, then the chance of your practice being held partly responsible if another party is negligent, will be minimised.

This column was prepared by Alexander Forbes Risk Services UK